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Google may jump into the mobile payment arena with a service that would let you check out at brick-and-mortar stores by waving your phone at the register, according to a report from Businessweek. The service could launch in 2011, and it would use near-field communication (NFC) technology to let customers pay by waving their phones up to 4 inches away from a checkout station.
Google chief Eric Schmidt suggested in November that NFC would eventually replace credit cards. Android 2.3 Gingerbread already includes some minor NFC functionality: it can read NFC tags, but not broadcast them to other devices (like registers). Buried in the Businessweek story is the information that Samsung's Nexus S handset already has the hardware to support NFC, and it will likely be the test device for Google's payment system.
eBay-owned PayPal is also readying an NFC-based payment service, says Businessweek. This one would allow transactions between PayPal users, not just between customers and businesses.
source: Businessweek